DoubleClick. plan. execute. analyze. May 2004 Investor Presentation. We Make Marketing Work Better

Transcription

1 plan DoubleClick execute May 2004 Investor Presentation analyze We Make Marketing Work Better DoubleClick Inc. All Rights Reserved. May 18, 2004

2 Forward Looking Statements This presentation contains forward-looking statements including earnings and revenue projections and future plans. The results or events predicted in these statements may vary materially from actual results. Factors that could cause actual events or results to differ from expectations include: lack of growth or decline in online advertising and marketing, intense competition in our industry, integration failures, changes in government regulation, operational failures and other risks that are contained in our SEC filings; including our most recent report on Form 10-Q. Forward-looking statements represent our estimates only as of today and should not be relied upon as representing our estimates as of any subsequent date. While we may elect to update forward-looking statements at some point in the future, we may choose not to do so even if our estimates change. We will also refer to certain non-gaap financial measures in this presentation. The non-gaap financial information is provided as a compliment to results provided in accordance with GAAP and management uses this information in analyzing the progress of the business. Please see the DCLK earnings press release dated April 15, 2004, for a reconciliation of EBITDA* to GAAP net income. Please see the Form 8-K filed on April 15, 2004 by the Company with the SEC for a discussion of why the Company believes EBITDA is a useful financial measure to investors and how management uses it. 2 *As presented herein.

3 Agenda DoubleClick Overview Data Overview Tech Overview - Marketing Automation Tech Overview - Ad Management Q104 Financial Highlights Performics Overview Takeaways Q&A 3

4 DoubleClick Mission Mission: We make marketing work better What does that mean?: We help our customers acquire new customers cost effectively through innovative data and technology tools We add value by helping to increase our clients productivity and return on investment for their marketing dollars 4

5 DoubleClick s Marketing Solutions TECHSOLUTIONS DATA Online Advertising ASP and software Tools for ad management (web publisher & agency) Online media planning tool for agencies Rich media tools Marketing Automation delivery tools Enterprise Marketing Solutions Campaign Management Marketing Resource Management Web analytics tool Data Solutions Catalog customer modeling Customer Data Management Solutions and Services 5

6 Data Solutions Database Marketing Abacus Alliances (US B2C, US B2B, International) Data Management Data Management Solutions 6

7 Database Marketing Abacus US B2C, US B2B, International, ChannelView Marketing Automation Abacus Alliance Revenue: $20.4 MM 1Q 2004 (reported in Data Segment) Data Segment Revenue: $22.8 MM 1Q 2004 Online Database Data Segment Advertising Gross Margin: Marketing 59.7% Marketing 1Q 2004 History: Primary Competitors: Marketing Analytics 14 year old business Acquisition in 1999 Experian, Info USA, D&B List Brokers 7

8 How Does an Abacus Alliance Work? Member A Transactions Better New Prospects Member B Transactions Abacus B-to-C Alliance Database Abacus Proprietary Modeling More Info on Existing Customers Member C Transactions Best Names off of 3 rd Party Lists 8

9 Case Study: Abacus CLIENT OBJECTIVE National Geographic Catalog Maximize revenue potential from existing customer lists (housefile) DCLK SOLUTION Abacus found prospects in under-used parts of list; among NG magazine subscribers w/ purchases similar to the NG Catalog; found names w/ purchase activity from similar offers CUSTOMER RESULTS From 2001 to 2002, housefile response rates increased 225 bps; profitable housefile circulation rose 136%; housefile performance increased by 58% 9

10 Data Management Data Management Solutions Marketing Automation Data Management: $2.4 MM 1Q 2004 (reported in Data Segment) Data Segment Revenue: $22.8 MM 1Q 2004 Online Database Data Segment Advertising Gross Margin: Marketing 59.7% Marketing 1Q 2004 History: Primary Competitors: Marketing Analytics 20+ year old business Acquisition in 2003 Experian & Various Smaller Players 10

11 What is Data Management? The design, development, and management of a client s customer marketing database (i.e. house file) The suite of tools to plan, execute, and measure multi-channel marketing campaigns The production services to update databases and execute marketing campaigns The analytics/modeling and strategic advice to help refine future marketing campaigns 11

12 Synergies via Data Management Enables Bundled Tech and Data Product Suite Data Management links , enterprise marketing, and website analysis with Abacus data to form a comprehensive, full-service, bundled solution Solidifies Abacus Alliance Position we can improve the accuracy of the Alliance data and may increase our sales by delivering larger prospect universes in a more timely manner Client Retention Managing the customer marketing database helps lock in strategic relationships & residual revenue streams Clients Demand It We believe that clients are actively seeking new service providers due to migration to multi-channel marketing 12

13 Data Segment Revenue Growth Through a Balanced Product/Market Portfolio Maturity US B-to-C 5-10% growth Data Management Abacus UK Ship It % growth US B-to-B ChannelView Prove It Abacus Japan Abacus Deutschland Early Stage 13

14 Marketing Automation Products Marketing DARTMail Website Analytics SiteAdvance Campaign Management Ensemble Marketing Resource Management SmartPath 14

15 Marketing Automation DART Mail, SmartPath, Ensemble and SiteAdvance Marketing Automation Revenue: $12.0 MM 1Q 2004 (Reported with the Tech Segment) Online Advertising Marketing Database Marketing Tech Segment Revenue: $45.3 MM 1Q 2004 Tech Segment Gross Margin: 70.4% 1Q 2004 History: Primary Competitors: 2002 Launch or Acquisition Marketing Analytics E.piphany, Digital Impact, Experian, & other single point players Strategic Services 15

16 Case Study: DART Mail Crate & Barrel used DARTmail to promote a retail sales event to drive furniture store traffic and sales. Used DARTmail to geo-target customers in their database. Used DARTmail to measure the response of the campaign. Results Store sales increased by more than 50% over the previous week during the promotion. DART mail campaign successfully drove store traffic and gave customers the opportunity to browse online before visiting stores. 16

17 DoubleClick Enterprise Marketing Solutions DCLK will automate strategic planning, asset and collateral production, customer segmentation, and analysis across channels*: Project Management Workflow Content Management / DAM Budget and financial management Predictive Analytics Descriptive Analytics Response Management Campaign Reporting Optimization ~ 17 * This list describes planned Ensemble and SmartPath integrated solution, expected before 2H2004. ~ Optimization features are planned for a later version.

18 Case Study: SiteAdvance Flax Art & Design needed to increase sales on website, decrease drop-off rate site, & simplify purchases. SiteAdvance team analyzed entry points, online search and checkout usually main areas driving rate of abandonment and lost sales. Results Exit rate dropped from 71% to 40 % New visitor drop-off decreased 31.5%, which along with improved search words, led to 4.8% increase in annual revenue. 18

19 Ad Management Online Publisher DART for Publishers DART Enterprise DART Motif Advertiser/Agency DART for Advertisers MediaVisor DART Motif Site Directory 19

20 Ad Management DART Online Ad Management Solutions Marketing Automation Ad Management Revenue: $33.3 MM 1Q 2004 (reported within Tech Segment) Tech Segment Online Revenue: $45.3 MM Database 1Q 2004 Advertising Marketing Marketing Tech Segment Gross Margin: 70.4% 1Q 2004 History: Primary Competitors: Marketing Analytics aquantive, 24/7, ValueClick, various smaller companies Strategic Services 6 year old business 20

21 DoubleClick Ad Management Solutions <a href..> <img src > Centralized campaign planning, execution, reporting, analysis, & creative optimization <a href..> <img src > <a href..> <img src > 21

22 Case Study: DFA Unilever needed: A solution that could support management and execution of campaigns across each brand s online advertising agency A partner with robust wireless, research, and strategic ad planning solutions A partner with strong global presence DFA is the solution: 95% of brands use DFA and Spotlight tags to measure site and creative ROI with help of assigned Project Manager Developed test to validate Internet as effective vehicle for brand and program awareness 22

23 DART Motif Makes Rich Media Work Better Easy, simple, integrated workflow for creation, trafficking, and reporting Fast, streamlined process -- automated from start to finish Supports all major rich media ad types Quality assurance through live preview testing Reduces errors Centralized reporting provides accuracy and consistency in comparing rich media and nonrich media ad effectiveness 23

24 24 Recent Financials

25 Across the Board Year-over-Year Growth in Q1 04 Revenue increases in every product group Record operating profit in TechSolutions All-time best TechSolutions gross and operating margins Ad management revenues up 7% Marketing automation revenues up 15% Data up 23%, or 10% excluding Data Management 25

26 Q1 04 Profitability Highlights Five consecutive GAAP profitable quarters Q1 All time best quarterly overall gross margins Operating profit improved from ($ 539 K) to $2.6 MM year-over-year Highest-ever Q1 EBITDA* in * See statement on non-gaap measures, such as EBITDA, on the disclaimer page of this presentation.

27 Other Financial Highlights Repurchased 1.9 million shares in Q1with an aggregate purchase price of $20.4 million Expect to have double-digit revenue and GAAP Net Income, growth, be EBITDA and CFFO positive in 2004 DCLK will update guidance on July earnings call, which will include anticipated effects of Performics acquisition. 27

28 Performics Search Engine Marketing Affiliate Marketing 28

29 Performics Overview Only industry-leading provider of both search engine marketing and affiliate marketing technologies Performance-based Marketing Based in Chicago 120 employees customers Experienced management team Profitable, EBITDA positive, & expected to have 50% year-over-year revenue growth in

30 Solutions for Cataloguers, Marketers, Agencies, and Publishers Search Engine Marketing Provides the technology and support to clients to automate paid placement, paid inclusion and comparison shopping listings across multiple search providers Affiliate Marketing Drives incremental sales/actions for marketers by managing, tracking and reporting on marketer s offers across multiple affiliate sites. Helps publishers monetize inventory through sponsored links 30

31 Deal Overview All-cash deal totaling $58 million, plus an earn-out of up to $7 million (for a potential total of $65 million). Expected to close by mid-june. Will expand DCLK s Search Marketing business & establish Affiliate marketing program. Performics will continue to be based in Chicago and DoubleClick expects to increase that workforce. Search Engine Marketing tool will be offered as a stand alone product & later integrated with DFA. Should be immediately accretive to EBITDA and should add at least $10 MM in revenues in 2H04. DCLK will update post-acquisition guidance on July earnings call. 31

32 DoubleClick s Marketing Solutions: 2H04* Online Advertising TECHSOLUTIONS Marketing Automation Performance Based Marketing DATA DATA Data Solutions ASP and software Tools for ad management (web publisher & agency) Online media planning tool for agencies Rich media tools delivery tools Enterprise Marketing Solutions Campaign Management Marketing Resource Management Web analytics tool Search Engine Marketing Management Affiliate Marketing Catalog customer modeling Customer Data Management Solutions and Services Multi-Channel Marketing Analytics 32 * Upon assumed completion of Performics acquisition.

33 Strategic Rationale Performance-based marketing is a fast growing and attractive market. Significant customer overlap. Performics will benefit from DoubleClick s global presence and gain access to DoubleClick s suite of products. DCLK customers will leverage wider range of marketing solutions and enjoy centralized reporting for entire online spend. Cataloguers, advertisers, marketers, and publishers will have single solution partner & unified reporting for planning, executing, and analyzing campaigns. DCLK is acquiring fast growing company. DCLK will solidify its position as the single-source marketing platform. 33

34 Takeaways DoubleClick already offers the most comprehensive suite of Technology and Data solutions for Advertisers, Cataloguers, Marketers, and Web Publishers Performics deal will enhance the offerings available to both DoubleClick and Performics customers Further details on Performics deal will be given on July earnings call 34

35 35 Questions?